.

We have witnessed two generations of Creans and Beazleys consign themselves to political oblivion in Australia by their failure to make the Ricardian connection between geography and public finance. The chances seem slim that Julia Gillard and Kevin Rudd might redeem this situation and, alas, John Howard and Peter Costello have already set us up for imminent financial collapse, as the debt they've allowed to be invested into a tax-induced real estate bubble of historic proportions starts to come home to roost. So, it seems too late for the Howard government to be able act upon Howard's quoted insights concerning revenue: "I do not deny that all taxes, with the exception of those on economic rent and inherited wealth, have some [adverse] employment and economic growth effects" (The Australian Financial Review, 10 October 1999.)

Taxing everything that moves is not yet seen to be the Mad Hatters Tea Party into which it really has been allowed to develop. Not only is it responsible for an incomprehensible mountain of tax legislation giving all the wrong signals to workers and business, but it has directly served to distend the housing bubbles which currently threaten western economies. Given that taxes sourced from other than the capture of community-generated annual land values always offend against at least one of the four classical canons of taxation, namely, that revenues:-

1. should bear lightly upon production
2. be cheap and easy to collect
3. be certain, and not able to be passed on
4. bear equally, giving advantage to none,

the neglect of land values as a major source of revenue is most perplexing. Perhaps even moreso, when a recent study by The Land Values Research Group which estimated that if we had collected only one half the annual value of Australia's ratable land since 1972 (and concomitantly less taxes on productive activities) having thereby obviated the development of real estate bubbles, Australia's GDP, accompanied by the positive multiplier effect that this action would trigger, would have grown to $2200 billion instead of the paltry $811 billion to which it hesitantly staggered in 2004. Perhaps this major blind spot about the sourcing of revenue is best understood in terms of a media bias misguidedly thought to favour its real estate advertising clients (because even they can be shown to be favoured ultimately by revenues drawn from land.) In light of the bad press given to land value capture (except for a carefully-restricted modicum collected at State and local government levels), politicians are unlikely to be burdened too much by principle in deciding from whence they will draw their revenues. Considerations of the canons of taxation go out the door in favour of 'plucking the goose so as to obtain the largest amount of feathers with the least amount of hissing as suggested by Jean Baptiste Colbert (1619-1683), or the equally ill thought out modern equivalent of 'the three legged stool', ie. that a mix of taxes on incomes, sales and property 'provides a wide and stable taxation base'.

But politics is 'the art of the possible', so shouldn't our politicians be let off the hook for taxing everything except land, notwithstanding the canons of taxation? Not at all, says Fred Harrison's excellent new book "Ricardo's Law, House Prices and the Great Tax Clawback Scam". Politicians ought not be poll-driven by the herd; they have leadership responsibilities. Otherwise, they are complicit in the tax-related damage wrought upon the citizenry outside our capital cities or, for that matter, even those people marginalised within tax-advantaged cities such as London. "The margin exposes the ugly secret that finance ministers prefer to conceal. Taxes reduce the productivity of the economy. They deprive people of income that they would have otherwise produced if government had not been so inept with its revenue-raising policies."

Harrison takes us upon an extraordinary journey from the centre of London northwards up the central ancient Roman road that provided access to Lincoln and up to Hadrian's Wall. Amongst other compelling analyses along this route, he demonstrates how, in keeping with Ricardo's Law, wealth, house prices and the very length of life itself all decline through England's nine statistical divisions as we proceed northwards towards Hadrian's Wall and beyond, into Scotland.

So powerfully does Ricardo's Law describe the means by which Tony Blair's well intentioned 'Third Way' experiment has failed Britain ["The spatially unequal production of rent (or public value) need not lock people into an unequal distribution of rent"] that Fred Harrison has thrown down the greatest challenge for anyone who professes to represent the public. This is Harrison's best book yet; the breakthrough for which those acquainted with principles advocated by Henry George have waited. His surgical exposition of the failure of government must quickly find its way into the hands of elected representatives so patently bereft of a sense of time and place.